If you are a borrower, either in the form of mortgage or loan, chances are alarmingly high that you are being or have been periled by lenders, brokers, and banks by their routinely changing loan terms between the time of application and closing. Sometimes, they can have justifiable reasons for doing so, but more often they don't.

Reasons

Sometimes, rejection does happen due to some mistakes that can be fount in your past credit history. Though they may have happened in the past, the consequence remains in the present. Many times people don't closely monitor their bills and accounts and sometimes miss payments or pay late. This can heavily damage your credit and may constitute and obstacle when trying to get approved.

Common Obstacles

In certain cases it may be hard to get a mortgage, for example if you are self-employed or if you have had debt problems in the past. Other probable situation is that if you're retiring within the next 2-3 months, then this situation can impede you from getting approval for mortgage. What’s the reason? Probably, because the lender thinks you won't be able to make the payments once you stop working.

It could be your income or employment status, or because of problems with the property. You could apply again to a different lender; however, you previous rejection will show on your credit report. If you have a bad debt case registered with a credit reference agency, you must ensure that correct details about you are recorded at the agency. If you find any information to be incorrect, contact the agencies to get your record corrected and inform the lender about the error committed on their behalf.

In case, a mortgage broker or lender has unfairly treated you, you can make a formal complaint. Under the Mortgage Code the firm ought to have a complaints procedure.

Read Thoroughly Before Applying

Often, the problem with some customers is that they forget to read everything specified in the promotions. Lenders may overstate the scope of what they're offering, just by throwing out terms like "pre-approved" or "approved, provided these conditions are met" and giving a superficial explanation in the fine print. This helps the lenders to cancel or modify their offers for countless reasons. When you object changes in the offer or in the loan terms, lenders just point out those disclosures.

So, whatever you apply for is never guaranteed because there are variables during the process that may change the initial assumed profile of the loan.

Borrowers unfamiliar with the ins and outs of the lending business could proceed happily towards closing on the loan, only to get surprised by a negative. Or to find out that they're going to pay up a few thousand more dollars or lose their houses and loans. Lenders think they don't need to cite a genuine reason to change the loan terms. Usually, brokers and lenders will just add some extra costs into a loan to book their profits. Thus, you need to be aware of your rights and read everything prior to signing.